Horus has developed successfully and needs additional funding. An IPO seems to be a natural step forward. After the bookbuilding phase, it is decided that 1,000,000 stocks would be sold in the IPO at a per-unit price of $10. You think that there is a 0.55 probability that the price will go up to $13 (underpricing) and 0.45 probability it will go down to 8 (overpricing) . You also know that there are two types of investor in the market (in addition to you): - Uninformed (e.g., individual investors): these investors always buy, and their aggregate demand is 800,000 stocks. - Informed (e.g., hedge funds): these investors know if the issue is under- or overpriced and they have the capacity to demand up to n stocks in aggregate. If the IPO is oversubscribed (i.e., if total demand is higher than the 1,000,000 stocks offered), every investor is rationed on a pro-rata basis. For instance, if total demand is 1,250,000 stocks, every investor receives 1, 000, 000/1, 250, 000 = 0.8 times the number of stocks he asked for. You plan to buy 100 stock in this IPO, what is the largest informed investor’s capacity (i.e., largest n) such that you do not lose money in expectation?

1. Imagine a league is composed of two teams, a larger (L) and a smaller (S) revenue team. W_L and W_S are their respective winning proportions. Their marginal revenue functions are (values in millions of dollars)

                                                MR_L = 90 – 90*W_L

                                                                        MR_S = 90 – 90*W_S

a. What is the equilibrium price of winning percent? Show it graphically as well.

b. What will be the values of W_L and W_S in equilibrium? Show them graphically as well.

c. What will be the equilibrium total talent bill for each? Identify them graphically as well.

2. Repeat problem number 1 with the following marginal revenue functions:

                                                MR_L = 95 – 90*W_L

                                                                        MR_S = 85 – 90*W_S

3. Repeat problem number 1 with the following marginal revenue functions:

                                                MR_L = 100 – 90*W_L

                                                                        MR_S =   80 – 90*W_S

4. Return to problem 2 marginal revenue curves. Suppose the league imposes a luxury tax of $45000 on each point (.001) over .500.

e. What is the new price of winning percent?

f. What are the new W_L and W_S in equilibrium?

g. What are the new equilibrium talent bills for each team?

Mattawa Manufacturing Inc. has four categories of overhead. The expected overhead costs for each of the categories for the next year are as follows:

Expected Costs Cost Driver

Activity Maintenance $510,000

Machine hours 60,000

Material handling 250,000

Material moves 20,000

Setups 60,000

Setups 3,000

Inspection 21,000

Inspections 12,000

Currently, the company applies overhead using a predetermined overhead rate based upon budgeted direct labour hours of 100,000. The company has been asked to submit a bid on a proposed job. Usually bids are based upon full manufacturing costs plus a percentage of 10 percent. Estimates for the proposed job are as follows:

Direct materials $30,000

Direct labour $24,000

Number of direct labour hours 8,000

Number of material moves 100

Number of inspections 120

Number of setups 24

Number of machine hours 4,000

Required:

1. If the company used activity-based cost drivers to assign overhead, calculate the bid price of the proposed job.

2. If the company used direct labour hours as the cost driver, calculate the bid price of the proposed job.

1....Madison Corporation has a $1,000 par value bond outstanding with a coupon rate of 9% interest. Interest payments are made semiannually. The bond matures in 20 years. If the yield to maturity for similar bonds is 9%, what is the value of the bond? Select one: A. $1,644 B. $1,000 C. $935 D. $908

2....What is the yield to maturity for $1,000 par value bond that pays a coupon rate of interest of 11%, has seven years to maturity, and is currently selling for $952?

Select one:

A. 10.52%

B. 11.63%

3....

A 30-year zero-coupon bond that yields 11% percent per year is issued with a $1,000 par value. What is the price of the bond on its date of issue?

Select one:

A. $33.38

B. $43.68

C. $98.43

D. $54.89

C. 12.05%

D. 13.12%

4.

A share of common stock has just paid an annual dividend of $4.00. The dividend growth rate is expected to be 8%. If the required rate of return is 12%, what is the current price per share?

Select one:

A. $100

B. $80

C. $86.40

D. None of these answers are correct

Fit the multiple regression of price on length and width

What is the fit has R^2 and Se(standard error)?

Show me how to work at the excel.

I did try to make the regression in excel that put y to price and put x to length and width but I did not get right answer that is R^2 = 0.92 Se = 64.15 (round to two decimal places)

Assume you are holding 1000 shares of XYZ stocks. You are considering using call options to hedge downside risk. The stock is selling at $45 and the following two call options are being considered for writing: an XYZ July 40 (i.e., the strike price is $40, and it expires in July); and an XYZ July 50. You are going to write 10 contracts, and each contract contains 100 options.

Part I.

Your broker provided you with the information about the prices of these two call options, one is $8 and the other is $1. But he forgot to tell you which one was for $8 and which one was for $1. Based on what you have learnt, what is the price for XYZ July 40 call? Briefly discuss, why writing a call option can provide downside protection for your stock holding.

Part II.

Compare two strategies:

Strategy A: write July 40 calls against your holding;

Strategy B: write July 50 calls against your holding.

Both strategies provide some downsize protection. Please explain which strategy offers a higher level of protection in the current case.

COST MANAGEMENT :Jay Banning, CEO and a major stockholder of Banning Inc., was unhappy with its operating results for the past year. The company manufactures two environmentally friendly industrial caliber cleaning machines used primarily in automobile repair shops, gas stations, and auto dealerships. The master budget and operating results for the year (000s omitted except for the selling price per unit) follow:

Required:

1. Compute the contribution margin flexible-budget variance, contribution margin sales volume variance, contribution margin sales quantity variance, and contribution margin sales mix variance for each product and for the firm.

Marco consumes chicken (C) and rice (R) for his meals. The price of a unit of chicken is $6, and the price of a unit of rice is $2.

Jon's utility function is: U = (3C)*(2R)

Jon has $132 to spend on chicken and rice."

a) For U = 100, which of the following (C,R) points are on the indifference curve?

Group of answer choices

(30,20)

(10,35)

(4, 54)

(0,50)

b) Is the indifference curve linear or non-linear?

c) Determine Jon's optimal bundle of chicken and rice to consume, given his budget and utility function.

Enter Jon's optimal amount of rice to consume (enter as a numeric value).

d) Now rice goes on sale for $1 per unit of rice. Now determine Jon's optimal bundle of chicken and rice to consume.

Enter Jon's optimal amount of rice to consume (enter as a numeric value).

e)  If there is a supply disruption and there is no chicken to purchase, what happens to Jon's utility? (Budget is still $132.)

Group of answer choices

Decreases to a small but positive amount

Becomes zero

Isn't effected

Do just the part c , d and e

On January 1, 20X1, Metro Plaza Inc. (MPI), a real estate company, using IFRS, issued $1,000,000, 8%, five year bonds for a cash price of $1,250,000. Interest is payable semi-annually on June 30 and December 31. Each $100 bond includes 20 warrants. Each warrant can be exchanged for one common share of MPI at an exercise price of $10 per share. The market rate of interest is 6% for similar bonds without warrants and the fair market value of these bonds was determined to be $1,085,302.

Required:

1. Prepare the appropriate journal entry to record the issue of the bonds on January 1, 20X1;
2. Prepare the appropriate journal entry required on December 31, 20X1;
3. How would the bonds be reported on the balance sheet at December 31, 20X1;
4. 30% of the warrants were exercised on July 1, 20X3 when the shares of MPI were being traded at $11,50. Prepare the appropriate journal entry or entries which the company should make on July 1, 20X3 to record this transaction.

Note: You may find it useful to answer this question by preparing a bond amortization table.

On December 31, 2020, Berclair Inc. had 440 million shares of common stock and 3 million shares of 9%, $100 par value cumulative preferred stock issued and outstanding. On March 1, 2021, Berclair purchased 120 million shares of its common stock as treasury stock. Berclair issued a 5% common stock dividend on July 1, 2021. Four million treasury shares were sold on October 1. Net income for the year ended December 31, 2021, was $750 million.

Also outstanding at December 31 were 30 million incentive stock options granted to key executives on September 13, 2013. The options were exercisable as of September 13, 2020, for 30 million common shares at an exercise price of $56 per share. During 2021, the market price of the common shares averaged $70 per share.

Required:

Compute Berclair's basic and diluted earnings per share for the year ended December 31, 2021. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Do not round intermediate calculations.)

SHOW ALL STEPS PLEASE